In Lebanon County, former George Washington Tavern is a tough sell

A mural depicting highlights of George Washington’s life wraps around one of the former George Washington Tavern dining rooms. - (Photo / Amy Spangler)

If you talk to its real estate agent, owner or past owner, the building that houses the former George Washington Tavern in Lebanon is a perfect place for a restaurant or bar.

It's just that the pesky public doesn't seem to agree anymore.

The building is on its third owner in 15 years and is heading toward a fourth if the group of midstate brothers that currently owns the building can sell it. The restaurant portion of the three-story building is vacant after Irish pub Patsy Fagan's closed in the fall after about four years in business.

Tate Investments LLC, a group of three brothers who invest in real estate, has had the historic city building at 1002 Cumberland St. up for sale since 2012. In the fall, it dropped the asking price by almost $100,000 — one quarter of the original price — to drum up interest.

Creston Tate, one of the brothers, said he still wonders why the location has such trouble attracting business.

"You got me," he said. "The building itself is absolutely beautiful. You can pick it up and put it somewhere else and it would thrive."

There have been about a half-dozen showings since the fall, according to listing agent Derek Bicksler of RSR Realtors in Lemoyne, but none of them resulted in significant interest. Bicksler said he's just as perplexed about why the spacious corner lot with almost 10,000 square feet of restaurant space and five already-leased rental units on the second and third floors hasn't been more popular on the market.

According to the description of the building from RSR Realtors, the apartments produce nearly $28,000 per year of net operating income even if the owner covers the utilities.

"It's a mystery," he said. "The historic value is there, all of the restaurant equipment is updated and included, it has a wine cellar in the basement, it's ready to go for a restaurant."

According to a 1932 report, "President George Washington's Three Visits to Lebanon County," the building, which dates from around 1760, was said to be a favorite haunt of Washington's when he came to town to check the construction progress of the Union Canal. The establishment was known as the Farmer's Hotel at the time, according to the report.

When Lebanon hospitality developer Kaj Skov bought the building in 2000, he turned it into a successful, upscale restaurant under the George Washington Tavern name for eight years.

That success for his version of the tavern only came through after $400,000 in renovations, he said, because the building had been vacant for 13 years when he bought it. Skov said the previous incarnation of the tavern had been closed in the late '80s by previous owner Abe Harounzadeh, who did not return a message for comment.

The Tates bought the building in 2007 for about $410,000, which was the building's appraised value at the time, Creston Tate said. The deal also included the liquor license — usually an expense of about $80,000 or more, Tate said — which sealed the deal.

But after having the building on the market for about 18 months with little action, Tate Investments took the step of dropping the price in December. Around that time, Patsy Fagan's closed. Its owner, Suzanne Cahill, could not be reached for comment.

Tate said Cahill had trouble paying the rent by the end of her time in the building and informed the brothers in October that she would be letting the building's lease expire and closing her business.

"We knew she wasn't making it," Tate said. "We tried for about 18 months to get somebody to lease it, but now we're just trying to dump it, cut our losses and go."

The building has challenges, most of which involve parking. There is only metered, curbside parking on both sides of the corner lot.

Tate said that because it's an old building it's going to have a little "arthritis," but otherwise, it's "solid."

"It's got a lot of character, a lot of history," he said. "If you can take advantage of that and have a menu that reflects that — like Kaj Skov did — then it can be a successful place again."

Beyond the challenges, Tate and Bicksler said the building has enough going for it that it would still be a find for anyone dedicated enough to put in the time for a restaurant business.

"It's a tough business," Skov said. "You're talking about 10-, 12-, 14-hour days, seven days a week. I think that's the biggest thing. (The next owner) better like what they're doing, have an idea of what they're doing and be consistent. But for sure, it's a beautiful building."

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Michael Sadowski

Mike Sadowski covers Lebanon County, banking and finance, law and the legal community, and technology. Have a tip or question for him? Email him at michaels@cpbj.com. Follow him on Twitter, @MikeCPBJ.
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